Dungeons are far less elective and have absolute time demands that are fairly substantive, yes. You and three other people WILL be doing a dungeon run for at least 30 minutes, probably 45, quite possibly 1 hour or more. You cannot take breaks, you cannot go AFK for very long, you cannot go 'dinner, brb in 15'. Fates don't require the sort of time commitment dungeons do, or the communicative coordination of multiple parties.
Ergo, dungeons would have to be substantially more rewarding than fates to pull even with them. If a dungeon takes ~1 hour to do, that isn't just any ol' hour. Its an hour in which you're committed. You can't so much as go afk to piss, or there's a good chance your tank or healer will go 'eff this' and go get another instaqueue.
If you're in an FC wherein you're fortunate enough to have people at all times wanting to do what you're wanting/needing to do, this isn't too much of a problem. So, the reward system as it is seems tuned to the perfect ideal.
If you and your perfect team can run a dungeon every 30-45 minutes, you could feasibly run 8-10 dungeons in an 8 hour play session, which would net you XXX,XXX experience, XXXX gil, etcetera, so on.
Nearly nobody has a perfect team to do things with at all times. I'd wager that a good chunk of us haven't had 8 hour play sessions since before we were adults with grown-up responsibilities, with the occasional burst during vacation times and other definitively 'not routinely' occasions.
When you do have a team, its unlikely that it will be perfect and a dungeon run might take far longer than a perfect dreamteam would've required. People go AFK. People take breaks. People get tired. Your tank from Arizona and your healer from Australia can't always be on at the same time as you in New Jersey and the other DPS in Florida. Your tank works nights IRL, your healer in Australia's unemployed and has to be awake during his day sometimes to go job hunting and your DPS in Florida's only around every 3rd day and nobody knows why.
This is commonly the reality of running group content; its been 'balanced' to make it fairly difficult for the people that play 16-18 hours a day, every day, to advance too rapidly. If you play 3 hours a night on weeknights and work weekends? You're pretty much boned. You won't get in an FC doing group content with that kind of schedule, you won't have teammates to do things with very often and you absolutely will not get much done this side of ever.
Unless you fate farm, of course. That is, presently, the only consistent means by which most people can consistently do anything with others. You run out of quests pretty fast; there goes most of the soloable content worth doing. Battleleves? Don't make me laugh; you're wasting leves you could be using to give worthwhile boosts to crafting for nearly nothing, and fates are free.
Even if you can do dungeons consistently, they just plain get sucky, tedious and boring when you've done the same one repeatedly, and while this is true of fates too, fates are not nearly so much hassle to get moving on in the first place.
If there were a lot more quests, people could rely on those more than having to do fates. Quests give pretty decent Gil, you see. Fates...frankly, don't. That'd be one good reason to run quests instead of fates, if you wanted gil and didn't want to be playing World of Craftercraft to do it.
Dungeons offering gear and token rewards of use to you no matter your level (Yes, even max level) would be good. For every dungeon, a daily XP bonus like we get the first time we do guildhests. Give guildhests a smaller-but-daily-recurring XP/Gil boost too.
Dungeons offering GC seals would be fantastic, even if just once per day as part of, oh, that as-yet imaginary daily "THANK YOU FOR KEEPING OUR DUNGEONS POPULATED" reward to get everybody running more dungeons of all levels, thus helping to ensure that more people get to do more dungeons at least a little closer to when they'd like to.
Stuff like that matters. Well, it will soon enough I suppose. It'll explain itself real soon, I expect.